Convert a PC into a Low-Cost Cash Register

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Many small retailers spend too little, or even nothing at all, on their point-of-sale (POS) systems. Sophisticated software and hardware packages aimed at retailers are simply too expensive for small businesses: We're talking $10,000 to $50,000, plus monthly costs. While $10,000 may not be a lot for super-retailers like Wal-Mart and Target, for a small business, it's a major investment. As a result, 80% of all retailers still use old-school cash registers—or even pen and paper—to handle their transactions, estimates Steven Aldrich, Intuit's QuickBooks Point of Sale general manager.

But these old-school retailers are leaving money on the table. Without automation, they can't track inventory in real-time, can't track customers, and can't automatically integrate their sales with financial software. Indeed, for every dollar the keep-it-simple merchant saves by using a cash register, they lose countless dollars in time and financial disorganization.

For system builders, however, this problem represents a business opportunity. Namely, a chance to build (and sell) low-cost retail systems that cost a lot less than $10,000 a terminal while still providing modern, automated functionality. The solution: build the system around a common, nothing-fancy PC.

Get on Yer Bike

For the purposes of this TechBuilder Recipe, I conjured the scenario of opening a small, independent, and single-store bicycle shop. The needs of this new bike shop would be relatively straightforward. The owner and employees would need to be able to scan and ring up cash and credit purchases, track inventory, and be able to call up pertinent data when away from the store.

I began by researching the hardware and software offerings that would be appropriate and/or available for a small business. I spoke with both independent and chain bike shops in the San Francisco Bay Area to learn what retail management systems and equipment they were currently using. Not surprisingly, I ended up with a massive list of products.

Winnowing this list down to something actionable took some time—and a little bit of outside thinking. After repeatedly hearing estimates in the $10,000 to $30,000 range for elaborate custom solutions that would require regular maintenance, I was forced to rethink my entire approach.

Enter Microsoft and Intuit. Both companies offer off-the-shelve solutions for retail businesses that—at least theoretically—let retailers quickly and easily set up shop. Intuit's QuickBooks Point of Sale, first released in 2001, lets retailers order a comprehensive software solution for POS and inventory management. Even better, for another $700, you can order an entire suite of hardware that's entirely compatible with the software package: bar-code scanner, cash drawer, thermal printer, and credit-card swipe. QuickBooks Point of Sale also allows fairly easy integration with QuickBooks, one of the most common financial/accounting software packages on the market. It's available both in retail stores like Office Depot and online.

Microsoft's Point of Sale is similar in concept to QuickBooks, although in my experience, neither the level of hardware integration nor the interface are quite as intuitive. For this reason, I decided to use QuickBooks Point of Sale.

Ingredients

Here's everything you'll need to build this low-cost retail system:

* Software: QuickBooks: Point of Sale 5.0 comes in three flavors: Basic ($800 retail), Pro ($1,050), and Pro Multi-Store ($1,400). For this Recipe, I used the Basic version. Technical support for QuickBooks Point of Sale costs an additional $49 per month from Intuit, although the first 30 days are free.

Given the direct and fairly easy integration between the Point of Sale package and Intuit's award-winning QuickBooks Financial Software, you'll also want a copy of QuickBooks; it retails for about $200.

Here's a shot of QuickBooks: Point of Sale:

* PC: QuickBooks Point of Sale requires a PC with at least a 500 MHz Pentium III or equivalent, with at least 256 MB of RAM. However, Intuit recommends at least a 1 GHz Pentium III or equivalent with 512 MB of RAM. This means you could easily convert an older PC into Point of Sale usage. I tested the software and hardware on an older 2.0 GHz Pentium 4 system with 512 MB of RAM, and I experienced no significant slowdowns once the software was launched. While it's difficult to find a new PC with a 2.0-GHz processor today, but you can buy PCs with faster 2.53-GHz Intel Celerons from Dell and other resellers for about $600, including a display. You can also find similarly fast PCs equipped with AMD's Sempron processor in the same price range.

* Point of Sale merchandise: Conveniently, Intuit offers up a Hardware Bundle for sale with the QuickBooks Point of Sale software for an additional $700. This bundle—which, with the software, amounts to an affordable $1,500—comes with the following peripherals:

• Star TSP600 Thermal Printer (for printing receipts).
• Star CF Media Cash Drawer.
• Credit-card swipe.
• Generic bundled laser bar-code scanner.

* Aftermarket add-ons: You can also add extra QuickBooks-compatible equipment to this package, such as a tag printer for printing out bar codes, a PIN pad for ATM card purchases, a pole display that displays prices to customers, and more. (For more details, see this Intuit list of QuickBooks-approved hardware.) I decided to keep things simple and opted for just one addition: the CipherLab 8000 wireless inventory scanner. This lets the user quickly and easily scan inventory all over a store, then synch up the data with QuickBooks Point of Sale on the PC.

* Metrologic Voyager bar-code scanner: Finally, after using the generic bar-code scanner that came with the Point of Sale hardware bundle, I decided to upgrade by switching to a laser bar-code scanner recommended by several Bay Area retailers. I'm glad I did. In addition to faster bar code pick-up, the Voyager also comes with a stand you can mount it in. Using this stand leaves the scanner in an always-on mode, which allows you to scan items by simply passing them underneath the scanner. (For more information, check out this Metrologic hand-held scanners page.) Here's a look:

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